«Price stability is the key contribution the National Bank can make to Switzerland's overall stability. This holds true even under current conditions», said Martin Schlegel on Friday, according to the transcript of his speech at the SNB's General Assembly in Bern.

To achieve this, the SNB's main policy tool remains the key interest rate. Foreign exchange market interventions also remain an option, if needed.

Even under changing global conditions, Schlegel is sticking to the SNB’s established approach. «Today’s global trade environment creates significant uncertainty for all countries involved—including Switzerland», he said, referencing the protectionist policies of U.S. President Donald Trump.

Fragmentation of the Global Economy

These developments affect economic outlooks and could, in the long term, lead to a fragmentation of the global economy. «As a small and open economy, Switzerland is particularly exposed to protectionist measures.», Schlegel added.

The SNB must continue to fulfill its monetary policy mandate—ensuring price stability while taking economic developments into account. «Stable and sound framework conditions, including price stability, are more important than ever,» Schlegel concluded.

No Guarantee of Profit Distributions

Barbara Janom Steiner, Chair of the SNB's Bank Council, warned that federal and cantonal governments should not assume guaranteed profit distributions from the central bank in their financial planning. She pointed to high balance sheet risks resulting from volatility in foreign exchange, capital, and gold markets—risks that have become even less predictable following U.S. tariff announcements. «There is no guarantee of annual SNB distributions.», she emphasized.

The strong profit recorded in 2024 has helped strengthen the SNB’s equity capital and replenish its distribution reserve, thereby clearing «the burden of two challenging previous years».

She firmly rejected the idea of creating a Swiss sovereign wealth fund financed through SNB foreign exchange reserves. Such a move would interfere with the SNB’s independence and complicate the implementation of monetary policy.

The SNB’s large foreign currency reserves are a result of its monetary policy decisions and do not represent real savings. If monetary policy requires it, these reserves must be reduced again.